Yesterday I enjoyed the most perfect veggie wrap at the Minuteman, my favorite local restaurant. Because the avocados helped to make it so good, I wondered whether it mattered that their price was rising.
So I asked Scott, the owner, several questions.
He confirmed that avocado prices were soaring. Had the price for a 25-pound case of Hass avocados been higher than $70, he would not have bought them this week. Because it was $67. (happily) he could put them in my wrap. And yes, like 82% of all avocados in the U.S., the ones in my wrap came from Mexico.
Bloomberg confirmed all that Scott said. Everyone is paying more;
Also we are all eating more.
Between 2000 and now, our avocado consumption tripled to seven or so pounds a person. Meanwhile Business Insider tells us that “Australians are Going Bananas For Avocados” and Bloomberg says the Chinese and Europeans are a part of the trend.
Predictably, production is way up from 17 years ago when Mexico sent us 24 million pounds of Hass avocados. In the 2015/2016 marketing year, the total was 2.3 billion pounds. However, California is due for a smaller crop this year because avocado trees are alternate bearing (less one year and then more the next). And we can only guess what a border tax would do to avocado imports.
Our Bottom Line: Supply and Demand
The avocado price hike is classic supply and demand. At the least, we have demand increasing and more quantity supplied:
And now it is even possible that instead of a change in quantity supplied, shrinking supply could nudge price further up :
As economists, we know why avocados will disappear from my veggie wrap!
My sources and more: After talking with Scott, I checked out Bloomberg and BusinessInsider. But this USDA “charts of note: site had the most up-to-date numbers.